News
Release

New Jersey Department
of
Banking and InsuranceCommissioner Holly C. Bakke

For Immediate Release:
November 22, 2004

For Further Information:: Mary Cozzolino
- (609) 292-5064

10,000 Drivers Join the Ranks of the Insured

TRENTON - Banking and Insurance Commissioner Holly C. Bakke announced today that more than 10,000 drivers purchased the Dollar-a-Day auto insurance policy during its first year. This important milestone shows that the auto insurance marketplace is providing drivers with choices that meet their financial needs.

"Rising sales of the Dollar-a-Day policy, combined with other programs, demonstrates that our efforts to help uninsured drivers with limited means drive legally are working," said Acting Governor Richard J. Codey. "By reducing the ranks of uninsured drivers more than $58 million has been added to the New Jersey system, bringing down costs for all New Jersey policyholders."

The Dollar-a-Day policy protects drivers from the biggest cost an uninsured driver may cause: emergency room care following an accident. This policy provides up to $250,000 of medical coverage ensuring a certain level of compensation to trauma centers. The policy also provides a $10,000 death benefit.

The Dollar-a-Day policy is available through most insurance agencies and costs $360 per year, or $365 if purchased in two six-month installments. Since October 2003, when the program began, New Jerseyans have bought more than 10,480 policies.

All Dollar-a-Day drivers contribute to the uninsured/underinsured motorist pool, reducing the financial burden on drivers who obey the law. A portion of the premium paid for every insurance policy written in New Jersey already goes to support this pool. More drivers contributing to the pool reduces rates for everyone.

"We are pleased that the Dollar-a-Day policy is reaching the people in the Garden State who need insurance," Commissioner Bakke said. "The policy is an integral part of a competitive marketplace that offers consumers choices of coverage and cost."

The Dollar-a-Day policy was designed to help make auto insurance available to drivers who are likely to go uninsured because of limited financial resources. Qualified candidates are limited to those enrolled in Federal Medicaid. Low-income drivers who do not have Medicaid should consider the Basic Policy, which offers minimum limits of liability and Personal Injury Protection coverage, as well as coverage for damage to another driver's car in the event of an accident. New Jerseyans have bought more than 25,278 Basic Policies since its inception and more than 4,000 this year alone.

The auto insurance reform initiative has delivered the following results:

State Farm announced it would remain in the New Jersey marketplace and begin writing new drivers;

GEICO became the second insurance company to enter New Jersey, writing policies exclusively over the Internet;

Mercury Insurance, which celebrated its first year in the marketplace, now writes more than 50,000 policies covering nearly 75,000 vehicles;

Allstate New Jersey has added new agents and is actively enrolling good drivers;

Auto insurers have returned more than $230 million to nearly two million drivers;

Appointment of more than 1,200 new auto insurance agents;

47,000 previously uninsured drivers now contributing more than $58 million to the system;

Introduction of an online program to provide New Jersey motorists with the information they need to determine the auto coverage they want and how much they want to pay for that coverage; and,

Consumer protection regulations were adopted to provide consumers with three price quotes when shopping for insurance, a Consumer Bill of Rights and a more user-friendly Buyer's Guide to explain coverage choices.